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Article
Publication date: 12 March 2024

Rida Belahouaoui and El Houssain Attak

This paper aims to analyze the impact of tax digitalization, focusing on artificial intelligence (AI), machine learning and blockchain technologies, on enhancing tax compliance…

Abstract

Purpose

This paper aims to analyze the impact of tax digitalization, focusing on artificial intelligence (AI), machine learning and blockchain technologies, on enhancing tax compliance behavior in various contexts. It seeks to understand how these emerging digital tools influence taxpayer behaviors and compliance levels and to assess their effectiveness in reducing tax evasion and avoidance practices.

Design/methodology/approach

Using a systematic review technique with the Preferred Reporting Items for Systematic Reviews and Meta-Analyses method, this study evaluates 62 papers collected from the Scopus database. The papers were analyzed through textometry of titles, abstracts and keywords to identify prevailing trends and insights.

Findings

The review reveals that digitalization, particularly through AI and blockchain, significantly enhances tax compliance and operational efficiency. However, challenges persist, especially in emerging economies, regarding the adoption and integration of these technologies in tax systems. The findings indicate a global trend toward digital Tax Administration 3.0, emphasizing the importance of regulatory frameworks, capacity building and simplification for small and medium enterprises (SMEs).

Practical implications

The findings provide guidance for policymakers and tax administrations, underscoring the necessity of strategic planning, regulatory backing and global cooperation to effectively use digital technologies in tax compliance. Emphasizing the need for tailored support for SMEs, the study also calls for expanded research in less represented areas and specific sectors, such as SMEs and developing economies, to deepen global insights into digital tax compliance.

Originality/value

This study has attempted to fill the gap in the literature on the comprehensive impact of fiscal digitalization, particularly AI-based, on tax compliance across different global contexts, adding to the discourse on digital taxation.

Details

Accounting Research Journal, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1030-9616

Keywords

Article
Publication date: 22 March 2024

Rida Belahouaoui and El Houssain Attak

This study aims to analyze the tax compliance behavior of family firms by integrating social and psychological norms with legitimacy determinants, focusing specifically on the…

Abstract

Purpose

This study aims to analyze the tax compliance behavior of family firms by integrating social and psychological norms with legitimacy determinants, focusing specifically on the Moroccan context.

Design/methodology/approach

Employing a qualitative research design, the study conducted semi-structured interviews with 30 chief executive officers (CEOs) of Moroccan family firms. The data were analyzed using thematic analysis to unravel the interplay between individual beliefs and societal norms.

Findings

The findings reveal a complex interplay between the personal norms of CEOs and chief financial officers (CFOs) and wider societal and cultural expectations, significantly influencing tax compliance behavior. The study identifies the multifaceted nature of tax compliance, which is shaped by personal ethics, family values and the dominant societal tax culture.

Research limitations/implications

The research is limited by its qualitative approach and focus on Moroccan family businesses, which may not be generalizable to other contexts. Future studies could use a quantitative approach and expand to other geographical settings for a more comprehensive understanding.

Practical implications

Insights from the study can assist policymakers and tax authorities in developing culturally sensitive tax compliance strategies that resonate with family business values.

Social implications

The research underscores the importance of considering sociocultural dimensions in tax compliance, fostering a more cooperative relationship between family businesses and tax authorities.

Originality/value

The study contributes a novel perspective by synthesizing social, psychological and legitimacy factors in understanding tax compliance in the unique context of family businesses.

Details

International Journal of Sociology and Social Policy, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0144-333X

Keywords

Article
Publication date: 11 July 2023

Ahmad Alshira'h

This study aims to investigate the relationship between trust in government, value added tax (VAT) compliance costs and VAT compliance in the Jordanian retail industry context.

Abstract

Purpose

This study aims to investigate the relationship between trust in government, value added tax (VAT) compliance costs and VAT compliance in the Jordanian retail industry context.

Design/methodology/approach

The study makes use of an online questionnaire survey to collect the required data, and the research model is eventually validated based on 189 responses gathered from the retail industry in Jordan. The obtained data was analyzed using partial least squares-structural equation modeling to examine the effects of trust in government and costs of VAT compliance on VAT compliance.

Findings

The results showed that VAT compliance costs have no significant influence on VAT compliance; while trust in government was found statistically positive significant with VAT compliance.

Practical implications

This study’s results are expected to have implications for VAT authorities and policymakers in Arab countries, like Jordan in their policies formulation to enhance VAT compliance in retail industry. The study’s findings are alerting the policymakers for the positive noneconomic consequences of VAT compliance. It provides evidence that trust in government can increase VAT compliance.

Social implications

The results of the research have a plentiful of social implications. Higher VAT compliance will enable higher levels of government spending on a many of social targets such as health, education, welfare programs and infrastructure.

Originality/value

While the study builds on recent research examining how to incentivize VAT compliance, it simultaneously seeks to make three contributions. First, the study design aims to apply recent advances in behavioral sciences (impact of trust in government and VAT compliance costs) in a policy area that has not seen much use of such interventions in the Jordanian context (i.e. VAT compliance). Second, the study is government procedures pertinent in the sense that it aims to increase the effectiveness of existing government policies by complementing them with behavioral primes. Third, there is nearly no literature found applying this topic in a developing country such as Jordan. To the best of the author’s knowledge, this is the first study that examines the trust in government and VAT compliance costs on VAT compliance among Jordanian retail industry. Thus, this paper contributes to mitigating the literature gap by providing empirical evidence concerning the influence of trust in government and VAT compliance costs on the retail industry VAT compliance in the Jordanian context.

Details

Journal of Money Laundering Control, vol. 27 no. 1
Type: Research Article
ISSN: 1368-5201

Keywords

Article
Publication date: 8 February 2024

Ahmad Farhan Alshira’h, Malek Hamed Alshirah and Abdalwali Lutfi

This study aims to determine the impact of forensic accounting, probability of detections, tax penalties, government spending, tax justice and tax ethics on value-added tax (VAT…

Abstract

Purpose

This study aims to determine the impact of forensic accounting, probability of detections, tax penalties, government spending, tax justice and tax ethics on value-added tax (VAT) evasion.

Design/methodology/approach

The study uses partial least squares-structural equation modeling to examine the connection between tax sanction, probability of detection, tax ethics, tax justice, forensic accounting and government spending on VAT evasion based on 248 responses collected from the retail industry in Jordan.

Findings

The findings also demonstrate that there is a negative correlation between tax sanctions, probability of detection, tax ethics, tax justice, forensic accounting, government spending and VAT evasion efficiency.

Practical implications

The results, considering forensic accounting and government expenditure considerations, may emphasize the importance of the tax sanction, probability of detection, tax ethics, adoption of tax justice in the public sector and tax authority. Additionally, the findings are important for regulators and decision-makers in announcing new laws and strategies for VAT evasion.

Social implications

It turns out that the tax authority and public sector can definitely improve their capacity to protect public funds and limit VAT evasion practices within SMEs by adopting increased tax sanctions, probability of detection, tax ethics, tax justice, forensic accounting and government spending.

Originality/value

Numerous studies have been conducted at the individual level in the context of income tax on the link between tax punishment, probability of detection, tax ethics, tax justice, forensic accounting and tax evasion. This study expands on the scant evidence of this connection to the retail business in the context of VAT avoidance. Additionally, it advances prior studies by integrating fresh elements, such as forensic accounting and government expenditure, that have never been considered in connection to VAT evasion in the retail sector.

Details

Journal of Financial Reporting and Accounting, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1985-2517

Keywords

Article
Publication date: 5 January 2024

Astrid Rudyanto

This paper aims to examine whether tax disclosure in Global Reporting Initiative (GRI)-based sustainability reporting mitigates aggressive tax avoidance.

Abstract

Purpose

This paper aims to examine whether tax disclosure in Global Reporting Initiative (GRI)-based sustainability reporting mitigates aggressive tax avoidance.

Design/methodology/approach

This study uses a multiple regression method for 714 nonspecially taxed firms listed on the Indonesia Stock Exchange in 2014–2018.

Findings

The findings demonstrate that disclosing tax payments in GRI-based sustainability reports reduces aggressive tax avoidance. Additional analysis indicates that the number of GRI-based sustainability reports positively affects aggressive tax avoidance. However, disclosing tax payments in multiple GRI-based sustainability reports negatively affects aggressive tax avoidance.

Originality/value

Recent prior studies demonstrate that aggressive tax avoidance does not indicate an organizational culture that devalues corporate social responsibility. This paper argues that firms cannot find the link between tax and corporate social responsibility when tax payments are not incorporated in sustainability reports. GRI considers tax a sustainability issue and seeks to institutionalize this concept by recommending that firms disclose taxes in their sustainability reports. This research analyses whether disclosing taxes in GRI-based sustainability reports may serve as a form of soft law by convincing firms that tax is a sustainability issue, thereby reducing their tax avoidance. This topic has received little attention in previous research.

Details

Journal of Global Responsibility, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 2041-2568

Keywords

Article
Publication date: 26 March 2024

Abba Ya'u, Mohammed Abdullahi Umar, Nasiru Yunusa and Dhanuskodi Rengasamy

Most research on tax evasion focused on microeconomic variables revolving around perceptions and decisions of individual taxpayers. However, a new wave of research is now…

Abstract

Purpose

Most research on tax evasion focused on microeconomic variables revolving around perceptions and decisions of individual taxpayers. However, a new wave of research is now investigating the role of macroeconomic variables in inducing tax evasion. This study adds to the limited studies in this new direction of research. Previous studies found that inflation, low gross domestic product (GDP) growth and gross fixed capital formation causes recession, increases unemployment, raise interest rates, hurts both domestic and foreign direct investments. This study examined the relationship between these variables and estimated tax evasion in Sub-Saharan Africa.

Design/methodology/approach

The study adopts a correlation research design with 2,300 data points collected from 23 countries in Sub-Saharan Africa. Specifically, tax to GDP ratio, gross fixed capital formation per GDP and the GDP annual growth report from each country for the period 2011–2020 was retrieved. Generalised least square regression technique was employed to analyse the data due to the presence of heteroskedasticity in the model and random effect was utilized based on the Hausman test. To avoid misspecification and biased result; therefore, all relevant test was conducted including the multicollinearity test.

Findings

The results indicate that GDP annual growth and gross fixed capital formation have a significant negative impact on estimated tax evasion in Sub-Saharan Africa. The findings further indicate a negative but insignificant relationship between inflation and estimated tax evasion in Sub-Saharan Africa. The study concludes that both GDP annual growth rate and gross fixed capital formation negatively influence estimated tax evasion and the policy implications in the African continent were discussed.

Originality/value

The new findings on the effects of GDP annual growth, growth fixed capital formation and inflation on estimated tax evasion provide novel knowledge that is currently lacking in the current literature, specifically Sub-Saharan African continent.

Details

African Journal of Economic and Management Studies, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 2040-0705

Keywords

Article
Publication date: 25 May 2023

Abhiyan Upadhyay

The purpose of this paper is to understand the financial opaqueness established through offshore businesses and financial secrecy through the requirements of information…

Abstract

Purpose

The purpose of this paper is to understand the financial opaqueness established through offshore businesses and financial secrecy through the requirements of information exchanges, and their deadly combination for facilitating money-laundering activities and tax evasion. It also puts into light some key recommendations for a country like Nepal that has been struggling to put adequate efforts into understanding financial opacity and secrecy.

Design/methodology/approach

This paper navigates through global issues on layering through opaque corporate structures, and mechanisms required for information exchange so as to figure out solutions and challenges to address them by developing countries like Nepal, with specific actions pertaining to Nepal.

Findings

Understanding financial opacity and secrecy is a prerequisite to tackling financial crimes. While focusing on global solutions and inherent challenges regarding such issues, concerted efforts are required to capacitate a country on contextual matters.

Originality/value

This work is an original work with an analysis of a global issue in an interconnected world with solutions catered to the local contexts of Nepal.

Article
Publication date: 12 September 2023

Usama Alqalawi, Ahmad Alwaked and Anas Al Qudah

This paper aims to determine the tax potential of G20 countries and estimate the tax revenue they could generate. The study evaluates the effectiveness of tax revenue collection…

Abstract

Purpose

This paper aims to determine the tax potential of G20 countries and estimate the tax revenue they could generate. The study evaluates the effectiveness of tax revenue collection for G20 nations from 2008 to 2020 and investigates the relationship between tax collection efficiency and tax evasion. The study also examines the link between tax collection efficiency and a proxy for tax evasion through anti-corruption efforts.

Design/methodology/approach

The study assumes that tax collection is a function of gross domestic product (GDP), population, imports and price level. The study uses a stochastic frontier analysis to calculate the efficiency of tax collection. It estimates the loss in total tax collection due to inefficiency by comparing actual and best-practice tax collection.

Findings

The findings indicate that anti-corruption measures and technological advancements positively impact tax collection efficiency. Great Britain is identified as the most efficient country in tax collection, whereas Saudi Arabia is the least efficient. Germany has the highest losses in tax collection due to inefficiency, while Australia experiences the lowest losses in tax collection.

Originality/value

This study suggests several practical implications. For example, legislators and policymakers should pay more attention to anti-corruption policies. Also, tax agenesis should focus on better understanding variations in tax collection efficiency between countries and how they relate to tax evasion.

Details

Journal of Money Laundering Control, vol. 27 no. 3
Type: Research Article
ISSN: 1368-5201

Keywords

Article
Publication date: 11 April 2023

Amneh Alkurdi, Taha Almarayeh, Hanady Bataineh, Hamzeh Al Amosh and Saleh F.A. Khatib

This paper aims to investigate the relationship between corporate profitability (CP) and effective tax rate (ETR) and to examine whether this relationship is moderated by board…

Abstract

Purpose

This paper aims to investigate the relationship between corporate profitability (CP) and effective tax rate (ETR) and to examine whether this relationship is moderated by board gender diversity (BGD).

Design/methodology/approach

The multivariate regression analysis was conducted to test the relationship between related variables. This study used sample of 70 Jordanian firms listed on the Amman Stock Exchanges for the period 2013 – 2020.

Findings

The results show a negative relationship between CP and ETR. Furthermore, the moderating variable BGD changes the strength and the sign, from a negative to a positive influence, of the relationship between CP and ETR.

Originality/value

To the best of the authors' knowledge, this study is among the first that provides empirical evidence regarding the relationship between CP and ETR in the light of BGD. Further, this study provides new and important insights that are not evident from the previous literature.

Details

Journal of Islamic Accounting and Business Research, vol. 15 no. 1
Type: Research Article
ISSN: 1759-0817

Keywords

Article
Publication date: 2 April 2024

Waqas Anwar, Arshad Hasan and Franklin Nakpodia

Because of growing corporate tax scandals, there is an enhanced focus on corporate taxation by governments, institutions and the general public. Transparency in tax matters has…

Abstract

Purpose

Because of growing corporate tax scandals, there is an enhanced focus on corporate taxation by governments, institutions and the general public. Transparency in tax matters has been identified as critical for effectively managing and promoting socially responsible tax behaviour. This study aims to explore the impact of ownership structure, board and audit committee characteristics on corporate tax responsibility (CTR) disclosure.

Design/methodology/approach

This research collected data from the annual reports of Pakistani-listed firms over 12 years, from 2009 to 2020. Consequently, the data set encompasses a total of 1,800 firm-year observations. This study uses regression analysis to test the relationship between corporate governance and CTR disclosure.

Findings

The results show that board gender diversity, managerial ownership and audit committee independence promote tax responsibility disclosure. In contrast, family board membership, CEO duality, foreign ownership and family ownership negatively impact tax responsibility disclosure. Additional analyses reveal the specific information categories that produce the overall effects on tax responsibility disclosure and assess the moderating impact of family firms on the governance and CTR disclosure nexus.

Practical implications

Corporations can use the results to encourage practices that enhance transparency and improve the quality of disclosures. Regulatory authorities can use the findings to stipulate better protocols. Doing so will be vital for developing countries such as Pakistan to improve tax revenue and cultivate economic growth.

Originality/value

While this research represents, to the best of the authors’ knowledge, one of the first empirical investigations of the association between corporate governance and CTR, the results contribute to the corporate governance literature and offer fresh insights into CTR, an emerging dimension of corporate social responsibility.

Details

Corporate Governance: The International Journal of Business in Society, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1472-0701

Keywords

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